New Bitcoin Futures Exchange Approved - The Industry Spread

Michael Volpe

After spending a decade in finance, Michael Volpe has been a freelance investigative journalist since 2009. His work has been published locally in the Chicago Reader, Chicago Crusader, Chicago Heights Patch, and New City. Nationally, Volpe's work has appeared in a wide variety of publications including the Washington Examiner, the Daily Caller, Crime Magazine, the Southern Christian Leadership Conference Newsletter, and Counter Punch. Volpe has been recognized by whistleblowers as leading the charge in getting their stories out. His first book Prosecutors Gone Wild was published in October 2012, his second book The Definitive Dossier of PTSD in Whistleblowers was published in February 2013 and his third book Bullied to Death was published in August 2015.

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New Bitcoin Futures Exchange Approved

April 23, 2020

A new exchange to trade Bitcoin derivatives has been approved by the Commodities Futures Trading Commission (CFTC). The CFTC made the announcement approving Bitnomial in a press release.

“The Commodity Futures Trading Commission today announced that it has issued an Order of Designation to Bitnomial Exchange, LLC located in Chicago, Ill., granting it status as a designated contract market (DCM), effective today. Bitnomial Exchange is a limited liability company formed under Delaware state law.

“The CFTC issued the order under Section 5 of the Commodity Exchange Act (CEA) and CFTC regulation 38.3(a). After review of its application and associated exhibits, the CFTC determined that Bitnomial Exchange demonstrated its ability to comply with the requirements of the CEA and the CFTC’s regulations applicable to DCMs.”

Bitnomial carries a basket of Bitcoin derivatives for trading, according to its website.

Its products include the Bitcoin/Dollar future, Bitcoin/Dollar option, and Deci Bitcoin US Dollar Futures.

Bitnomial was founded in 2014.Its founder and Chief Executive Officer is Luke Hoersten, who was previously a managing partner at Allston Trading LLC.

“On the FX desk of Allston Trading, Luke witnessed first-hand as the markets sought a safe haven from global economic uncertainty. Investors piled into the Swiss Franc causing its value to soar and impair Swiss exports. The Franc-Euro peg and subsequent unpeg caused even further economic turmoil. Bitnomial was founded to solve market dynamics and access problems,” the company says on its website.

“We are building the Bitcoin Product Complex, a suite of interrelated financial products, starting with quarterly Bitcoin futures, micro futures, and options. Additionally, our products initially trade on 37% margin and are settled on-chain instead of book entry,” Hoersten said of Bitnomial getting CFTC’s approval.

The company continued in a press release, “Bitnomial Exchange has been approved to operate a US futures and options exchange as a designated contract market (DCM) by the US Commodity Futures Trading Commission (CFTC). Bitnomial will list margined and physically delivered Bitcoin futures and options, the first and only startup exchange to achieve these capabilities.

“The approval allows Bitnomial to tackle a confluence of generational shifts in financial markets: First, a new generation of customers are emerging as savvy with trading, technology, and delivery. Second, innovative new unregulated derivatives are booming with daily volumes topping $45B but may be illegal for many US traders. And third, the US futures market system is calcified by legacy structures and monopolies and has struggled to connect with these new growth areas.”

The other executives at Bitnomial include: Matthew Wraith who is the Director of Information Technology, Michael Dunn who is the Director of Market Operations and Surveillance, and James Walsh who is the Chief Regulatory Officer.

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